IB History, The Great Depression

29th October 1929, 16 million shares are greatly reduced. Prices fall drastically. Prices continue to fall until July 1933, stock prices were at 15% of their value in 1929. (estimated losses of $74 billion) 1931-1933, banking crisis hit USA and a lot of Europe - banks collapse (Northern Rock).

Governments try to protect themselves from the Depression: Raising Tariff barriers against imported goods. Started a 'Tariff War' - Britain in 1932 created an 'Imperial Preference System'.

Fell by about 23% from 1929-1931, and even by 1938 it was only 40% of the 1929 value.

Worldwide confidence drop in capitalism and in parliamentary democracy. Germany and Japan were hit the hardest (which made them more inclined to wage war)

\"Caused Hitler's uprising\". Germany was reliant on US loans - Capitalist democracy The year before the Great Depression, Nazis had 3% of the vote. As unemployment rose, the Nazis gained 17% of the seats and became second the second biggest party. At the unemployment peak in 1932, Nazis had 37% of seats in Reichstag - President Hindenburg thus appointed Hitler Chancellor in January 1933.

Japan changes its foreign policy. Up to the Wall St. Crash - Japan was expansionist, taking Taiwan from China and Korea from Russia in 1905. Also had held a good relationship with west; LoN, Naval Treaties, good terms with China. Post Crash - Radical change in foreign policy; authoritarian style of politics; undermining of parliamentary system and growing influence of the military.

Silk prices dropped to 20% o te 1923 figure, half of Japanese farmers reliant - blamed the government, and decided working with the West would be counterproductive. Instead they decide imperial aggression is the best course of action.

Invasion of Manchuria - 1931 Full scale China invasion - 1937 Occupation of Indo-China - 1940 Pearl Harbour - 1941, (resulting in USA joining WWII).

\"The economic crisis... did more than anything else to sour relations between the major states...\" - Richard Overy